Donald Trump and Mark Carney aren't exactly seeing eye-to-eye. Credit: Chip Somodevilla / Getty
Tensions flared again between the U.S. and Canada after President Donald Trump accused Canada of a “blatant attack.”
Canadian Prime Minister Mark Carney, 60, had maintained calm ties with President Trump, who respected Carney’s background as a former banker.
But a new tax shattered that fragile peace.
Canada introduced a 3% digital services tax on companies like Amazon, Google, Meta, Uber, and Airbnb.
The tax is retroactive to 2022 and leaves U.S. tech giants facing a $2 billion bill by month’s end, according to NBC News.
It applies to revenue from Canadian users if it exceeds $14.6 million in a year.
On June 27, Trump reacted on Truth Social, slamming Canada’s new tax.
“We have just been informed that Canada, a very difficult Country to TRADE with…
has just announced a Digital Services Tax on our American Technology Companies,
which is a direct and blatant attack on our Country,” he wrote.
He accused Canada of copying the European Union, which is also in talks with the U.S. on similar issues.
“Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately.”
He ended with a warning:
“We will let Canada know the Tariff they will be paying… within the next seven day period.”
Shortly after Trump’s post, Carney responded bluntly:
“We’ll continue to conduct these complex negotiations in the best interests of Canadians.”
Trump escalated the rhetoric later in the Oval Office.
“Economically we have such power over Canada. We’d rather not use it.
It’s not going to work out well for Canada. They were foolish to do it,” he said, per The Independent.
Asked how talks could resume, Trump replied Canada could remove the tax—then added, “It doesn’t matter to me.”
This clash follows a letter from House members urging Trump to act fast.
They called the Canadian tax “unprecedented” and “retroactive,” warning it could set a dangerous global precedent.
“Allowing Canada to proceed… would signal the rest of the world they can launch similar discriminatory cash grabs,” they warned.
Trade between the U.S. and Canada totaled about $762 billion last year, according to the U.S. Trade Representative’s office.
Canada is one of America’s top trading partners, making Trump’s freeze a major shake-up, The Guardian reports.
In the same Oval Office appearance, Trump also targeted Europe over similar digital tax plans.
“They have been unbelievably bad to us,” he said.
“If you look at past presidents, they’ve treated them very badly.”
He continued:
“They’re being very nice to me, because I get it. I know the system.
We have the cards—far more than they do.
They haven’t treated us well, and now they’re coming to us.”
Trump added:
“They’re nasty people, and I don’t want them affecting U.S. companies.
If anyone’s going to affect a U.S. company, it should be us.
If there’s a penalty or fine, let it be paid to us.”
